Oando PLC opens N54.6 Billion Rights Issue Offering


Oando PLC, Nigeria’s leading indigenous energy group, listed on both the Nigerian and Johannesburg Stock Exchange, today opened its Rights Issue to raise N54.6 Billion through the issuance of 4,548,236,276 ordinary shares of 50 Kobo at N12.00 per share. On the basis of two (2) new ordinary shares for every ordinary share of 50 Kobo each held as at the close of business on Friday, 19 October 2012 for those shareholders whose names appear on the Register of Members and transfer books of the Company which are maintained in Nigeria and shareholders whose names appear on the Register of Members and transfer books of the Company which are maintained in South Africa as at the close of business on the Friday prior to the issue opening date, 4 January 2013.

The Rights Issue exercise will open on Friday, 28 December, 2012 on the Nigerian Securities Exchange, 4 January 2013 on JSE Limited, and close on Wednesday, 6 February, 2013 on both exchanges. Vetiva Capital Management Limited is the Lead Issuing House, with FBN Capital Limited and FCMB Capital Markets Limited will act as Joint Issuing Houses.

The proceeds from the Rights issue will be used for the following:

•       Part-repayment of N60 billion syndicated loan used to fund the acquisition of upstream assets and swamp drilling rigs.

•       Part-financing of acquisition of upstream and midstream assets by Oando’s Upstream subsidiary, Oando Energy Resources (“OER”).

•       Investment in working capital to support increased level of business.

Commenting Mr. Wale Tinubu, Group Chief Executive, Oando PLC said: “We are happy to announce the opening of our Rights Issue offering, in line with our corporate strategy for balance sheet optimization and the financing of growth initiatives in the Upstream sector.

“Pursuant to the recent signing of agreements by our affiliate OER with ConocoPhillips, to acquire their entire Nigerian Asset base for $1.79 Billion plus customary adjustments, OER will be transformed from a small size oil company with ~4,500 bbls/day of production and 9 million barrels of oil equivalent (“MMboe”) to a midsize oil producer with close to 50,000bbls/day of production with 2P reserves of 213 MMboe and 2C reserves of 198 MMboe, with significant risked resources.”

“The successful outcome of the Rights Issue will position Oando to increase value for shareholders in the Upstream through focused portfolio growth in production, cash margins and improved returns on capital deployed. We count on the consistent support of our shareholders to seize the opportunity to take up their rights and benefit from the higher margin value creation the Upstream offers.”